It's been a long time coming. But after years trying to differentiate their offer from the big box multiples on the basis of superior "localness" and service credentials, the independents are finally waking up to the need to compete more effectively on price.

Last week, Booker announced its intention to concentrate on the pricing of 'essential' products such as bread, milk, eggs and potatoes with long-term fixed price promotions in a bid to compete with the multiples and even discounters. And all 19 candidates who stood for election to the board this week at Nisa-Today's, which was set up to help retailers achieve better deals on price, agreed that price was the number one issue. But is an EDLP strategy the answer?

Symbol operator Select & Save certainly thinks it is. Since launching a campaign last year in which it claimed to be cheaper than Tesco on key convenience lines, its store numbers have soared 50%, which retailer development manager Tony Houlston puts down to standing up to Tesco on price.

Now Booker hopes to emulate its success on a larger scale. Director of retail and Premier development Steve Fox says its strategy is two-fold: to leverage its buying power to offer its retail customers lower prices and better margins and to help those customers challenge consumer perceptions that independents are more expensive. Its Everyday Essentials initiative focuses on key lines such as bread and milk because they are core ranges and the most price-sensitive lines.

"If you take everyday essentials such as bread and milk, you can pass on savings to shoppers on basic commodities," says Fox. "Consumers look for better prices on everyday lines. We can do that."

However, he concedes Booker will have to demonstrate its buying power is strong enough, which is why it joined European buying group AMS to launch its Euro Shopper value range in July. "We can do that if we are supported by buying groups and can react more quickly to buying trends than multiples," he says.

Even so, the volumes at some smaller, rural stores do not justify such a strategy, according to Nisa-Today's MD of central distribution trading and logistics, John Sharpe. Price-led promotions work best in larger, town centre c-stores, he says. "It doesn't suit smaller community stores, which have lower footfall and higher costs."

However, a hardline pricing strategy could play into the hands of the multiples, says retail expert Richard Hyman, chairman of Verdict. "Independents need to set their own agenda," he said. "Whatever an independent can do on price, a supermarket can more than match and always will."

It is a point echoed by several independents. Conrad Davies, who runs a Spar in Pwllheli, says the only way to survive is to out-local the multiples. Even then it won't be easy, he says. "Tesco is going to get it right soon and Asda is working very hard along the right lines, too," he says. "There are others who have shoved Welsh flags outside stores and believe they are in tune with the local community. It is cynical nonsense. They make a great play about sourcing locally and then bring in Devon cheese. The way we win is by offering products that are truly local and a little different."

Whether they're pushing the price or local retailer message, the real challenge for independents is to get their PR right, says Diana Bird, the founder of Wedge Card, a discount loyalty scheme for local shops. Supermarkets are not always the cheapest, she says. "The only way to get people to realise that is to go further to entice them away from larger shops."n